4.3.2  Fairness and equity of tender process

Changes to the project after the signing of the project agreement were reviewed to determine if any post-tender project scope changes or proposed contractual terms materially impacted on the tender put to market.

Variations to the contract did not result in a material change from the project brief and did not materially impact on the tender put to market.

The Project Agreement permits the parties to amend or vary the Project Agreement provided that such amendment or variation is made in writing executed by both parties.

The parties agreed to vary the Project Agreement in the manner set out in two deeds of variation. The first deed of variation was the result of updated DHS design guidelines that required specification changes to be made to the design of the new building.

The second deed of variation introduced amending instruments. This is the formal document that details the agreed changes to the service specifications or design requirements that can be entered into by the Project Director and the project company. The second deed of variation gave rise to four amending instruments, but did not impact on time or project cost.

The Project Agreement also outlines a process for introducing State Initiated Modifications (SIMs). There have been 15 SIMs to April 2008 (one rejected, seven accepted, and seven requested but not yet finalised). The total cost of the SIMs was less than $1 million. Further project funding was not required for the modifications as these were either funded by external stakeholders or from within the approved project budget.

A summary analysis of the post-tender changes is provided below:

Figure 4F Summary analysis of the post-tender changes

Source: Victorian Auditor-General's Office analysis of DHS information.

The completed Neonatal Intensive Care Unit